This is March Madness

This week parents at our school were trying to figure out how to buy copy paper and pencils so that we could keep our librarian and music teacher, at least part time. Crazy conversations like this are taking place in schools all over the state at the same time Governor Corbett is arguing that he increased funding to public education. And it’s not even April Fools Day for two more weeks.

On the other hand, Tim Eller, a spokesman for the Department of Education, said that the real problem is schools have to spend less: “This isn’t that more money’s needed … It’s that school districts and educational entities need to realize and recognize that we’re in an economy that has not improved yet, and they need to take the necessary actions to spend within their means.” (Post-Gazette, 3-12-12) So the state says it is giving schools more money, but those schools need to spend less – which means cutting teachers and educational programs.

Maybe this is just March madness. But let’s remind Governor Corbett that our schools need both pencils and librarians. School districts are already cutting into the bone, as the numbers below demonstrate.

In the fall, as students were headed back to school with the state’s new $1 BILLION cuts in effect, the Pennsylvania Association of School Administrators and the Pennsylvania Association of School Business Officials conducted a survey of the impact of those cuts. Of the state’s 500 school districts, 59% responded, giving a very good picture of how public education has already been dramatically affected:

  • 70% of school districts increased class sizes above what they were last school year.
  • 58% delayed purchases of technology, such as computers.
  • 55% indicated they reduced or eliminated student field trips.
  • 44% reduced course offerings, such as foreign languages, arts, music, physical education and even some core subjects, such as math, English, sciences and social studies.
  • 35% reduced or eliminated tutoring.
  • 33% reduced or eliminated extracurricular activities, including sports programs.
  • 20% eliminated their summer school programs, in which students can make up the necessary credits to allow them to graduate on time.
  • 4 school districts eliminated full-day kindergarten, and 9 reduced their full-day kindergarten programs.
  • 14,159 positions were cut or left vacant

10 thoughts on “This is March Madness

  1. Excellent post. Just a correction on the data. In the report that you linked to, the numbers don’t match up to yours here… they are worse. For example “Fifty-five percent of districts indicated they have reduced or eliminated student field trips” and then this one, “Nearly thirty-five percent of school districts have reduced or eliminated programs that provide extra help or tutoring for struggling students.” Yet, Gov Corbett subsidizes expanding jails and destructive industries that are poisoning the people.This is truly madness.

  2. Oh, can I please send my children, grandchildren and great grandchildren to be educated in your state? Have any of the highly paid administration people taken a salary cut? No, how surprising.

  3. The 800 pound gorilla – salaries and benefits. Local school boards, like mine (York Suburban), have granted pay increases that run 2 to 3 times the rate of inflation for the last 10 years. By 2018, benefit costs will rise to $15,000,000 (compared to salaries of $25,000,000). Our teachers earn an average of $80,000 in a county where the median HOUSEHOLD income is less than $50,000. Unless teachers are willing to take pay cuts, not freezes, there is no way boards can retain current programs. We can either pay all teachers less and retain programs or we can pay fewer teachers more (per their contracts) and cut programs.

    • Teachers’ salaries (and benefits) probably should constitute the bulk of education spending – that’s where I want to spend my education dollars. While I agree that school districts have to keep all their costs under control – and pension obligations are taking a growing bite (as I’ve written about here before) – I refuse to lay the blame for our current budget crisis at the feet of teachers.
      I’m not sure where you are getting your numbers: the best I could find this morning through the Department of Education website is for 2006 (link below). The Morning Call in Allentown has a nice site with 2006-07 data (link also below), showing York County teacher salary averages ranging from $34,043 to $66,519 (in your York Suburban school district, for teachers averaging almost 16 years on the job). Here in Allegheny County, salaries were ranging that year from $29,074 to $71,181 (for teachers with almost 18 average years on the job).
      This is an important discussion. But I also want to point again to this story about a local teacher working two jobs just to make ends meet (a far more common story, I’m afraid):

      • I am a first-term board member – the figures come directly from our finance department. I have a comparison of salaries for 150 teachers who were on the payroll in 2005-06 and 2010-11. During that 5-year period, average salaries for that group increased from $63,482 to $83,318, an average of 5.6% per year. This year (2011-12), a first-year teacher with a bachelor’s degree earns $46,875. At the top of the scale, a teacher with an MS+60/Doctorate in step 14 earns $86,775. Compare these numbers to your data and you’ll see just how quickly our salary costs have risen.

  4. Joel, congratulations and condolences on your election — without some sort of relief from the state, you’ve got a near-impossible job ahead of you. I’ve got an acquaintance who just got on the board in a suburban Pittsburgh district and he’s about ready to jump out the window! You are right on-target about payroll/benefit costs, though I think you should focus more on the problems I discuss below. I also see from a quick news scan that you’re willing to consider and even propose unpopular ideas in the hope of saving your district from fiscal disaster – we need more of that from school board members across the state.

    Before I comment on your district’s situation, I have a complaint (don’t you love being an elected official?:) – although your district has somewhat more on-line financial information posted than some, it’s not enough to allow you or your constituents to make informed decisions. A 7-page state form and a 65-page independent audit is a start,but you need historical trends and 3-5 year forecasts. Had your board had that back in 2007, I’m certain they would have made different and better decisions.

    This is one area where you as a school board member could really make a difference. Insist that your financial officers provide a better level of information, both by posting more on your website and by demanding they give you more detailed forecasting information on projected revenues and expenditures. They are your employees, and you can only make decisions (and inform the public) based on what they give you.

    Regarding salary growth: I suspect your numbers come from the double whammy of pay increases built into your district’s collective bargaining agreement and the pay steps themselves. If your data is for the same 150 teachers between then and now, most of the increased salary cost is from them having more experience and being paid for that experience per the agreement. The secondary part would be any additional degrees (masters, PhD) they’ve earned since then. I can’t find your District’s CBA on the web, but I’m sure you can get a copy from your finance department. Also, you are probably top-heavy, with 50% or more at the top of the pay scale, so cutting 10% of staff won’t get anywhere near a 10% cost reduction.

    You are correct that benefits, and in particular pensions, are what will kill your budget for the next several years. I can’t find the detailed forecasts I’d like for your school district, but pension obligations are a problem for everyone: they are mandated by state law, they are set by the state Retirement System, and the actuarial numbers are both scary and reliable. In addition, public pension obligations are an immovable object: the courts have ruled that they constitute a binding contract that can’t be canceled or modified, and they would even survive bankruptcy (unlike private corporation pensions).

    Pension obligations are at this point much more important than teacher salaries (and deserve more than a single sentence on p. 10 of your district’s audit report). You’re also right that escalating salaries make it worse (most pension benefits are based on the last year or two of earnings, so raising the salaries of the most senior employees is the gift that keeps on giving).

    However, I agree with Jessie that focusing on payroll won’t fix your district’s fiscal problem – even if you achieved a 10% cut in next year’s payroll line, your savings would be wiped out in 2 years by your increasing obligations to the state pension fund. Alas, you can’t simply cut your way out of this problem.

    • Paul, thanks for the thoughtful and helpful reply. I couldn’t agree more with your last statement. Last night, at a meeting with 7 local legislators, a PSBA rep, and about 100 school board members and administrators from York County, I took the microphone to “make the case” (once again) for a complete overhaul of the K-12 funding system in light of the constitutional obligation our general assembly has to provide for a “thorough and efficient system of public education.” You are also correct in your assessment of our school board’s historical behavior. My wife tells me all the time to “press for specificity” when we get plastered with platitudes about our approach to educating our children. I have hundreds of pages of information from the district and PDE that give me a real advantage in the discussions – it’s hard to argue with facts. However, there’s also the issue of reading and UNDERSTANDING what you’ve read. Several of our board members simply don’t put in the time to research the issues and ask the tough questions. They’ve rarely if ever attend classes and prefer to make appearances at high profile events. Even with the frustrations so far, I’m truly enjoying the journey and I believe that I can make a positive difference for our students and our taxpayers.

  5. Joel, I think that if people are given a simple financial projection, with the emphasis on what will happen to their own tax situation or kids classrooms, they will quickly become motivated to considering alternatives.

    My quick-and-dirty estimate for 2012-13 shows your district running about a $750K – $1.3 million deficit, depending on assumptions about revenue growth and inflation. That would require a 2.0% – 3.6% property tax hike to close the deficit, or more likely a combo of cost-cutting and tax hiking.

    However, the following year, you’d need another 5.5% tax hike, followed by 8%, followed by double-digit hikes every year for the foreseeable future. No district can take that kind of financial punishment, even one like yours, where state aid makes up only about 11% of your budget.

    The key point is that not one dollar of those budget cuts will reduce the property tax burden, and not one dime of those tax hikes will help kids in classrooms. In my scenario (and in the governor’s budget projections), all of the real budget growth goes to meeting increased pension obligations.

    If your numbers are different, please let me know: I can share my assumptions with you or e-mail you the spreadsheet and you can tweak as you see fit. The details matter: my goal is to develop a model, tuned to local financial realities, that works for a range of school district around the state.

    I know you may find this hard to believe, but so far York Suburban appears to be one of the most responsible districts in tackling costs and revenues (the revised CBA with the teachers is a great start). You’ve got several advantages: you’re a relatively prosperous district with a union willing to make concessions to address costs, and you don’t depend heavily on state aid. If you’re getting killed, imagine what some of the others must look like.

    Anyhow, here’s my stab at a deficit table for your district:

    Year Projected Rev.Total Budget Pension $ Deficit
    2010-11 $46,167,972 $46,227,992 $1,343,049 -$60,020
    (^last year^)
    2011-12 $46,794,473 $47,571,314 $2,084,535 -$776,841
    (^this year before adjustments^)
    2012-13 $47,521,696 $49,111,124 $3,014,339 -$1,589,428
    (^next year^)
    2014-15 $48,350,599 $50,849,059 $4,133,986 -$2,498,459
    2015-16 $49,213,420 $52,649,302 $5,307,544 -$3,435,882
    2016-17 $50,073,182 $54,437,601 $6,460,648 -$4,364,420
    2017-18 $50,561,133 $55,476,143 $6,855,364 -$4,915,010
    2018-19 $50,994,947 $56,399,952 $7,126,601 -$5,405,005

    • Paul – your projections are right on the money (pun intended). With our “wealth” Suburban’s Act 1 index is always the base value (this year 1.7%). Even with exceptions (for which we did not apply), the most we could raise taxes would be 2.8%. As you aptly pointed out, tax increases alone aren’t sufficient to balance the budget.

      Furthermore, trimming the fat, so to speak, is also futile in the face of exploding pension obligations. Five years from now, salaries will grow from $23 to $25 million while benefits grow from $8 to $15 million. No business can sustain benefits at 60% of salaries, and we can’t either.

      Would you please consider calling me to discuss these issues? My home number is 717-845-4277. Along with David Baldinger, a well-known taxpayer advocate, I will be meeting with representatives of the Commonwealth Foundation next week to discuss education finance and property tax reform. I would love to get your input before I go.

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